Microsoft asks for EU advice on pricing

Microsoft fears reprisals for Windows protocol

Microsoft asked the European Commission today how much it should charge for protocol information, in an attempt to defuse the latest crisis between the regulator and the software giant.

On 1 March, the Commission alleged that Microsoft had proposed charging too much for the information, which would allow rival makers of workgroup servers to build products that work properly with PCs running Windows.

The Commission ordered Microsoft to disclose the information as part of its antitrust settlement with the company in 2004, but the two have been at odds over how that information has been documented as well as pricing.

In a statement, Microsoft's senior vice president and senior counsel, Brad Smith, said the company would not request an oral hearing on the pricing issue, one of its rights.

"We need greater clarity on what prices the Commission wants us to charge, and we believe that is more likely to come from a constructive conversation than from a formal hearing," Smith said.

The Commission has stressed that the protocols should be offered "on reasonable and non-discriminatory terms”. The Commission contends there is not enough innovation in the 1,500 pages of documents Microsoft has submitted since December 2005 to justify the prices it wants to charge.

The protocols would allow, for example, third-party printer management software to work better with Microsoft operating systems. The company has created an extensive licensing plan, Workgroup Server Protocol Program, depending on how a manufacturer would use the protocols.

Microsoft could face fines of up to €3 million per day if the Commission is unsatisfied. Last month, European competition commissioner Neelie Kroes called Microsoft's behaviour "unacceptable”, as the company continues to gain market share.

In July 2006, the Commission fined Microsoft €280.5 million for failing to provide the interoperability information. In the 2004 antitrust ruling, Microsoft was fined €497 million.